Spurred by savings of Rs 400 crore in FY09, Jet Airways chairman Naresh Goyal is hopeful that his cost-cutting measures will help save Rs 300 crore in 2010. The company has trimmed its staff strength to nearly 12,000 from 14,000. Jet has also leased over three Boeing 777, amongst other aircraft, in the previous year, since they were rendered surplus, he said at the 17th annual general meeting of shareholders.
The revenue generated through leasing of aircraft was over $150 million in FY09 and the company aims to enhance revenues to $250 million by the end of FY10.
While addressing at the AGM, Goyal said like other industries, airline industry is also under pressure due to the downturn. Jet had reported a net loss of Rs 961 core for FY09.
The chairman urged the government to rationalise aviation turbine fuel (ATF) prices, airport usage and navigation charges which are nearly 70% higher than the international benchmarks. Currently, airlines are collectively lobbying with the government to get a uniform tax structure of 4% on ATF prices since taxes are anything between 25-35% in various states. Goyal said Jet will raise funds when market conditions are favourable. Jet has been looking to raise $400 million via rights issue for the past two years but has deferred its plans.
Goyal said, “We have replaced our B-777s on most of the long-haul routes with smaller Airbus 330-200. We are doing so since our international operations face receding demand and price sensitivity, particularly in our long-haul routes.?
The chairman said the company’s performance for FY09 must be viewed favourably, considering the adverse and difficult conditions.” Revenues per passenger kilometres increased over 26% mainly on account of growth in our international operations,” he said.
Goyal also said that by the end of October this year, of the 283 flights, nearly 130 would be on JetKonnect, its low fare flights introduced recently to capture the market. “The market is moving towards low cost model and so are we,” he said.